Double-Take Software, Inc. Announces Second Quarter 2007 Financial Results
biz.yahoo.com
Tuesday July 24, 4:01 pm ET
SOUTHBOROUGH, Mass.--(BUSINESS WIRE)--Double-Take Software, Inc. (NASDAQ: DBTK), a leading provider of recovery solutions, today announced its financial results for the second quarter 2007.
"We had great revenue and operating income growth and are very pleased with our results in the quarter ending June 30. We continue to see solid demand for our products and continued tangible benefits within our customer base as they protect themselves against unplanned downtime. Revenue was strong, in part, due to a robust demand amongst our customers to ensure their licenses are under contract to receive recent product updates and, I believe, because of our position as a trusted provider of software for disaster recovery in the virtual market space and for full server recovery" said Dean Goodermote, Chairman of the Board and CEO of Double-Take Software.
Total revenue for the quarter, which consists of software revenue, maintenance and professional services revenue, increased 36.2% to $20.0 million in the second quarter of 2007 from $14.7 million in the second quarter of 2006. Revenue for the second quarter of 2007 includes revenue from Double-Take EMEA for the entire quarter. (Double-Take EMEA, which was Double-Take Software's near exclusive distributor in Europe, was acquired by the Company on May 23, 2006).
Software revenue increased 24.4% to $12.0 million in the second quarter of 2007 from $9.6 million in the second quarter of 2006. Maintenance and professional services revenue increased 58.7% to $8.0 million in the second quarter of 2007 from $5.1 million in the second quarter of 2006.
Operating expenses for the second quarter of 2007 increased 35.6% to $13.9 million from $10.3 million in the second quarter of 2006. Included in the operating expenses are the following items:
* Stock option expense of $0.5 million in the second quarter of 2007 related to SFAS 123R as compared to $0.3 million in the same quarter in '06 related to SFAS 123R and the vesting of stock options for the former CEO.
* Amortization of intangible assets of $0.2 million for the second quarter of 2007 as compared to $0.1 million in the second quarter of 2006 related to the acquisition of Double Take EMEA.
Income from operations was $4.0 million in the second quarter of 2007 compared to $2.1 million in the second quarter of 2006.
The company recently completed an analysis of the valuation allowance recorded against its deferred tax assets and concluded that the Company should reduce the valuation allowance related to its deferred tax assets by $4.7 million. This amount represents the benefit that the Company has determined, in the second quarter, that it is more likely than not to realize in future periods from utilization of net operating loss carryforwards. Additionally, the Company recorded a current tax expense of $1.9 million in the second quarter. The result was a net tax benefit during the quarter of $2.8 million.
Net income attributable to common stockholders, which includes the aforementioned deferred tax benefit, was $7.5 million, or $0.33 per diluted share, in the second quarter of 2007 compared to net income attributable to common stockholders of $0.1 million, or $0.02 per diluted share, in the second quarter of 2006.
Income from operations on an adjusted, non-GAAP basis in the second quarter of 2007 was $4.4 million, compared to $2.4 million in the second quarter of 2006. Adjusted, non-GAAP net income before accretion and dividends on preferred stock in the second quarter of 2007 was $8.0 million, which includes the deferred tax benefit, compared to $2.4 million in the second quarter of 2006. Dividend and accretion charges occurred until our Initial Public Offering in December 2006 when all preferred shares were converted into common shares.
Adjusted, non-GAAP net income per diluted share, which includes the effect of the deferred tax benefit, was $0.35 in the second quarter of 2007. We calculate these adjusted non-GAAP income measures by excluding the effects in the respective periods of the non-cash SFAS 123R and other stock-based compensation expenses described as components of Operating Expenses above. An explanation of these non-GAAP financial measures and a reconciliation of these measures to GAAP results are provided in the tables included in this press release, and these measures should only be viewed together with the reconciliation and the further explanation given under "Non-GAAP Financial Measures" below.
Cash, cash equivalents, and short term investments at June 30, 2007 totaled $60.9 million.
Guidance
Revenue for the third quarter of 2007 is anticipated to be in the range of $20.2 to $20.7 million and adjusted non-GAAP operating income is expected to be $3.8 to $4.0 million. The effective income tax rate is expected to be approximately 35% to 40%. Non-GAAP net income per share for the third quarter of 2007 is expected to be in the range of $0.11 to $0.12 per share excluding the impact of stock-based compensation charges and weighted average diluted shares are expected to be approximately 23.4 to 23.5 million shares. Weighted average shares are calculated using the treasury method and include anticipated stock option grants and exercises but no other issuance of shares.
After taking the results of Q2 2007 into account, the Company is increasing its full year revenue, operating income and earnings per share guidance. Full-year 2007 revenue is now expected to be in the range of $81.1 to $82.1 million. Operating income is expected to be $15.3 to $16.0 million and adjusted, non-GAAP income per share for the full year 2007 is expected to be in the range of $0.72 to $0.74 excluding the impact of stock based compensation charges and using an estimated full year effective tax rate of approximately 10%. The full year effective tax rate includes the effects of the deferred tax benefit. Weighted average diluted shares are assumed to be approximately 23.2 to 23.3 million shares. Weighted average shares are calculated using the treasury method and include anticipated stock option grants and exercises but no other issuance of shares. |
